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Friday, January 28, 2011

First, Chevron said there was no contamination in the Ecuadorian rainforest. Then, Chevron said no one had been harmed by the contamination. Now, Chevron says the plaintiffs in the lawsuit don’t exist, and it’s all a figment of our imagination. Read Kate Sheppard’s piece from Mother Jones:

The long legal case against Chevron over environmental damage wrought by drilling operations in the Amazon may finally be drawing to a close, as the parties in the case this month began filing their final arguments. But Chevron has made several attempts to get the case thrown out entirely--including making claims that the plaintiffs in the case don't actually exist.

Last month, Chevron made accusations of an "elaborate forgery of plaintiffs' signatures" in the suit. When the complaint was first filed in 2003, 48 indigenous residents of Lago Agrio, Ecuador, affected by the legacy of toxic pollution left behind by Texaco (a company Chevron later acquired) signed on as plaintiffs. Chevron claims that its forensics expert has determined that 20 of those signature were forged, and that therefore the lawyers representing them in the case did not truly have consent.

Chevron vice president and general counsel R. Hewitt Pate almost sounded like an activist in Chevron's press release last month, pledging to "seek full redress against the harm that has been done in the name of the Ecuadorian plaintiffs and to hold accountable all of those who have knowingly participated in this unlawful scheme." The irony, of course, is that the plaintiffs are seeking compensation for what they have described as massive environmental and human health harm caused by decades of oil extraction in the region that was never fully remediated.

Chevron says this is evidence that the suit has been "tainted with corruption from the very beginning and must be terminated." The company's lawyers filed a motion in the provincial court asking the judge to therefore declare the lawsuit "null and void."

In response, 24 of the plaintiffs involved in the case held an event this week to re-sign the documents, a symbolic effort to show that they are, in fact, real and they do have very real complaints against Chevron, namely the billions of gallons of toxic waste that they say was dumped in their Amazon communities. (The total number of plaintiffs is now down to 47; one has died since the suit was originally filed.) The lawyers for the plaintiffs say the forgery claims show that Chevron is getting "desperate" in these last-ditch efforts to get the case thrown out, rather than challenging the question at stake in the suit—whether the oil giant is indeed responsible for the alleged damage caused by its subsidiary.

"It's part of their fantasy of saying that this lawsuit doesn't really exist," Karen Hinton, spokesman for the plaintiffs, tells Mother Jones. "The only way to maneuver now is to discredit the court, the lawsuit itself, the plaintiffs and the lawyers—anyone associated with this—through various personal vilification campaigns."

The Ecuadorian court is supposed to rule on the case sometime before May, though it's likely that it will remain tied up in this legal wrangling for some time. If the forgeries claim is any indication, Chevron will throw every obstacle it can think of in the way of a final decision.

Lago Agrio, Ecuador – Several indigenous plaintiffs in the historic environmental lawsuit against Chevron in Ecuador came together this week at one of the oil giant's polluted well sites in the Amazon rainforest to once again "prove" they are real in light of Chevron's latest legal motion claiming they don't really exist.

Chevron's legal team in Ecuador, which has been sanctioned recently for filing frivolous motions to delay the trial, had asked the court in December to dismiss the lawsuit on the grounds that one of its paid American "experts" determined that the signatures of 20 of the 48 named plaintiffs had been forged by their attorneys. The case has been on trial in Ecuador since 2003 and is nearing a final judgment, with the top end of damages estimated at $113 billion.

Chevron is accused of deliberately dumping billions of gallons of toxic waste into the Amazon from 1964 to 1990, when it operated a huge oil concession. The disaster is considered by some experts to be the worst oil-related environmental problem in the world today, with an area the size of Rhode Island laden with toxins.

Chevron's lawyers had claimed that there were discrepancies between some of the signatures on the lawsuit filed in 2003 and the same signatures attached to national identity cards in Ecuador. In disputing the allegation, the plaintiffs had accused Chevron of engaging in "desperate" tactics to derail a lawsuit it is losing based on the scientific evidence.

Pablo Fajardo, the lead attorney in Ecuador, said any discrepancies resulted from the fact the indigenous plaintiffs rarely sign their names to documents and thus any two signatures from the same person usually look slightly different. Chevron's American expert, Gus Lesovich, clearly had no understanding of this critical issue when he reached his flawed conclusions, said Fajardo.

Thirteen of the individual plaintiffs who were accused of having their signatures forged appeared this week before a notary to affirm that it was in fact their signatures on the lawsuit against Chevron. Each of the individuals stated that their signatures were their own.

“I find it humiliating that Chevron has said that the signatures are not genuine, and so I am here in person to sign with my own handwriting, yet again, and thus affirm the contamination that they have caused,” stated Hugo Camacho, President of the Pimanpiro community in the province of Orellana.

“It is not enough for [Chevron] to have killed our people, killed our rivers and our air, but now they are treating us like common criminals, like forgers. This is an outrageous indignity,” added Camacho.

Victor Tanguila, one of plaintiffs signing his support for a lawsuit against Chevron

“Chevron had promised that its expert analysis ‘proved’ that the signatures were false,” said Karen Hinton, spokeswoman for the plaintiffs. “But we now know that the only thing that has been ‘made clear’ is Chevron’s willingness to hire and pay any expert to make inaccurate claims to derail a lawsuit where it faces an enormous liability."

The latest expert report by Lesovich is just one of many improper allegations put forth by the company as the 17-year litigation has entered its final stages.

Examples of Chevron’s improper tactics in the litigation include putting out fake news reports that appear independent, trying to pay a journalist to spy on the plaintiffs, setting up dummy corporations in Ecuador to hide the company's role in testing soil samples, and mounting a sting operation to entrap an Ecuadorian judge presiding over the case. The company has also bombarded the Ecuador court with frivolous motions, leading to sanctions against its legal team.

The plaintiffs recently filed the first part of their final argument finding that "there is irrefutable evidence of contamination" at every one of Chevron's 45 former well and oil production sites inspected by the parties during the trial. The chemicals and compounds found -- all of which are toxic and some of which are known carcinogens -- include barium, benzene, cadmium, chromium, copper, etheylbenzene, polycyclic aromatic hydrocarbons, vanadium, xylene, and zinc.

"The evidence makes it clear and unmistakable that Chevron is guilty," the summary of the alegato concludes. "Guilty of polluting the rainforest with toxic sludge from lucrative oil drilling operations, guilty of a shoddy and haphazard cleanup operation, guilty of letting toxic waste continue to devastate the rainforest and its inhabitants' lives, and perhaps worst of all, guilty of trying to cover it all up by destroying documents and making false accusations of fraud before courts in the U.S. and Ecuador."

Tuesday, January 25, 2011

If you are thinking about criticizing Chevron about its oil drilling practices, go hire a lawyer now. Dozens of American citizens have had to lawyer up during the past year because of Chevron executives’ Putinesque refusal to suffer any criticism whatsoever. Sheila McNulty, who covers the oil industry for the Financial Times out of Houston, reported this week that an inquiry by the United States Proxy Exchange found Chevron inappropriately refused a number of people with legitimate proxies to attend its last shareholder meeting, including four people who were arrested after Chevron called the police. About 20 people had traveled from Ecuador, Nigeria, Burma and Angola to attend the meeting but were refused. The people arrested were American activists who have criticized Chevron in the past.

At Chevron’s last shareholder meeting, five people were arrested. The company has for years now been having a hard time with protestors – particularly about a lawsuit about environmental damage allegedly left in Ecuador by one of the companies it acquired. And certainly the arrests of those who the company says were troublemakers at the meeting must have been a welcome turn of events for Chevron.

Yet it really has not worked out as Chevron might have hoped. There will likely be continued protests at its upcoming shareholder meeting.

Todd Ward of the prominent Houston law firm DeGuerin & Dickson took the defendants’ case without payment because he felt those arrested had been treated unfairly and it was the right thing to do.

The Harris County district attorney let one of the protestors go. The other four were offered deferred adjudication, whereby all charges would be dropped if they did not protest at the next shareholder meeting. Only one accepted that. The other three refused.

Among them was Mitch Anderson, corporate campaigns director at Amazon Watch, which has been a thorn in Chevron’s side over Ecuador. He pled guilty, the court accepted the day he already had spent in jail upon being arrested as time served, and he is free to continue protesting.

Although he insists he was not guilty, Mr Anderson says he wanted the case behind him so he could get back to work:

I plan on being as vocal at the upcoming shareholder meeting as I was in the past. Chevron has failed to own up to its responsibility for environmental contamination in Ecuador. And with a court decision looming, this is too vital a time for us to be restricted from shedding light on the Ecuador environmental disaster.

Chevron does not believe it is responsible for whatever environmental damage remains in Ecuador.

Mr Anderson considers the arrests part of that publicity battle and, in his words, pure harrassment. He claims he had a valid proxy – the same document he has used to attend past meetings. In all, the protestors say some 19 people were told their proxies were invalid. Chevron said it could not confirm that.

But it does insist Mr Anderson’s proxy was invalid. And, besides, it insists it did not make the arrests or prosecute Mr Anderson and the others – the county did. The company only called the police to get the trespassers from blocking the path of shareholders. What happened next was out of its hands.

Nonetheless, Chevron said the protestors arrested were being disruptive. One had tried to lead shareholders in an anti-Chevron chant; others had sat in front of the exits, blocking the doors. And others had refused to move beyond the barricade to keep out those without valid proxies. This was interfering with the ability of those who were there to listen to participate in the meeting:

We do not condone behavior which could compromise the safety and security of our employees and stockholders. The Harris County District Attorney’s office has prosecuted four individuals for their actions at Chevron’s Annual Stockholders’ Meeting. We are confident that this matter is being handled appropriately by the District Attorney’s office, and we will continue to cooperate with them until it is resolved.

Yet, regardless of how all five cases are finally resolved by the courts, Glyn A Holton, executive director of the United States Proxy Exchange (USPX), a non-profit dedicated to facilitating shareowner rights, is disappointed in the whole affair.

Following the shareholders’ meeting, he said, volunteers of the USPX obtained and reviewed a number of sets of proxy credentials presented for admission. Some of these were presented by individuals who were admitted. Others were presented by individuals who were denied admission. The latter included the credentials of four of the individuals who were denied admission and were arrested:

All credentials we reviewed were legitimate and should have been sufficient to gain admission to the meeting. As far as we can determine, Chevron enforced no consistent standard for admitting or not admitting individuals based on their credentials. Admission decisions appear to have been made either arbitrary or based on criteria unrelated to the credentials presented. We found instances where two people presented identical credentials; one was admitted, and the other was not.

He gave some examples, including this one:

The Missionary Oblates of Mary Immaculate beneficially own 7,628 shares of Chevron stock in an account with Manufacturers and Traders Trust Company. Manufacturers and Traders Trust Company executed a legal proxy appointing the “Missionary Oblates of Mary Immaculate (beneficial owners) Represented by Henry Clark” proxy for those shares, “with full power of substitution”. The Missionary Oblates of Mary Immaculate combined this with their own legal proxy also naming a Henry Clark to represent them at the annual meeting. Clark presented them at the annual meeting and was denied admission. His credentials were among the strongest we reviewed.

Chevron did not address the individual examples cited by Mr Holton. It only said:

We stand by the protocols we have established related to our Annual Meeting. Chevron is transparent about the legal requirements needed to gain entry to the meeting and consistent in our enforcement of those requirements.

A trial might have been good to settle the issue once and for all. Without it, it seems, Chevron may have won the battle, with the guilty pleas, but it may well still lose the war of public opinion. For just one of those arrested must stick to the sidelines during the upcoming shareholders meeting. And, with the Ecuador situation still unresolved, something tells me this meeting will be just as aggressive – if not more so – than the last.

Monday, January 24, 2011

The Ecuadorians suing Chevron for the world’s largest oil contamination disaster have submitted the first part of their final written argument to the Ecuador court, outlining the evidence that clearly demonstrates Chevron's liability in the $113 billion environmental damages lawsuit and the fraud behind the company's primary defense of remediation.

The court filing -- called an "alegato" in Ecuador -- details in exacting detail how evidence gathered by independent experts, the plaintiffs, and from Chevron itself proves the case against the oil company. Read the summary and press release about the argument. The lawsuit was first filed in U.S. federal court in 1993 but was shifted to Ecuador at Chevron's request. The plaintiffs are tens of thousands of persons who live in area of Ecuador where Chevron operated several large oil fields from 1964 to 1990, reaping excess profits by using substandard practices.

“Could there be enough "overwhelming" evidence against Chevron to merit a payment of over $100 billion? Tens of thousands of Ecuador's residents are the plaintiff in an environmental damages lawsuit against Chevron, and they believe the evidence speaks loud and clear….”

Responding to Chevron’s efforts to distract attention away from the contamination with accusations of corruption against the Ecuadorian court, Han Shan of ChevroninEcuador wrote:

“But here we are with the final arguments, and the judge deliberating on a decision that is widely expected to be delivered this year. The plaintiffs have brought on DC mega law firm Patton Boggs and high-profile lawyer James Tyrrell, who vows that the plaintiffs will be able to enforce a judgment against Chevron and win major damages to be put to environmental cleanup and healthcare in their communities.”

Wonk Room's Brad Johnson headlined his blog with, "Chevron, Under Pressure For Destruction of Amazon, Was Top Lobbyist Last Quarter," He wrote: "Chevron, responsible for a multi-billion-dollar environmental disaster in Ecuador, is instead spending millions to shore up political support and to evade the clean up." Senate disclsoure forms reveal that oil giant Chevron spent $2.9 million lobbying the federal government last quarter, eclipsing even Exxon ($2.6 million) and BP ($2.2 million)."

Chevron has long argued, as its primary defense at trial, that a "remediation" conducted between 1995-98 released it from any responsibility. Despite Chevron’s claims, a summary of the plaintiff’s alegato concludes the legal release used by Chevron as a result of that remediation is "null and void" because it was based on numerous false and misleading representations by the company. Instead of actually cleaning up the waste in the area, the limited “remediation” was largely accomplished by simply covering a small number of waste pits with dirt and then using an inappropriate laboratory test that counted only a fraction of the actual contamination to “prove” that the remediation had been effective.

"The evidence makes it clear and unmistakable that Chevron is guilty," the summary of the alegato concludes. "Guilty of polluting the rainforest with toxic sludge from lucrative oil drilling operations, guilty of a shoddy and haphazard cleanup operation, guilty of letting toxic waste continue to devastate the rainforest and its inhabitants' lives, and perhaps worst of all, guilty of trying to cover it all up by destroying documents and making false accusations of fraud before courts in the U.S. and Ecuador."

The document concludes that Chevron is responsible for ongoing contamination that is harming the environment and human health to this day, even though the company fled Ecuador in the early 1990s and stripped its assets out of the country. The main arguments are as follows:

Chevron treated the environment "recklessly" and deliberately disposed of billions of gallons of toxic waste into rivers and streams over the 26-year period that it operated a large oil concession in Ecuador's Amazon region. "These lax operational practices have had a devastating impact on the rainforest ecosystem and its inhabitants," according to the document.

Chevron dumped more than 16 billion gallons of chemical-laden "produced water" into streams and rivers over 70 years after the industry had stopped the practice in the United States due to its damaging environmental impacts.

Chevron built and then abandoned more than 900 toxic waste pits filled with oil drilling byproducts such as barium, heavy metals, chloride, and acid -- all of which need extensive remediation.

Chevron polluted the air by flaring gas with no controls, spilled thousands of barrels of oil, had no spill response plan, and ordered the destruction of records documenting oil spills.

The plaintiff’s "alegato" also found that "there is irrefutable evidence of contamination" at every one of Chevron's 45 well and oil production sites inspected by the parties during the trial phase of the case in the affected area, which is 1,500 square miles in size and covers a swath of rainforest roughly the size of Rhode Island. The chemicals and compounds found -- all of which are toxic and some of which are known carcinogens -- include barium, benzene, cadmium, chromium, copper, etheylbenzene, polycyclic aromatic hydrocarbons, vanadium, xylene, and zinc.

The alegato also explains how it is Chevron -- not PetroEcuador -- that is responsible for the contamination given that the vast majority of pollution occurred at the time Chevron's 356 well sites were drilled and operated by the American company. The legal concept of "joint and several liability" also imposes on Chevron responsibility for 100% of the damage it caused because of the substandard system it built and operated.

The submission is the first of three parts. The second and third parts -- which deal with damages and issues relating to due process -- will be released in the coming days. Earlier damages assessment reports submitted by the plaintiffs found the company could be liable for up to $113 billion in costs.

San Francisco, CA – Chevron's self-described "clandestine" operations agent Diego Borja, his wife Sarah Portilla, and collaborator Wayne Hansen have left California after two U.S. Federal Courts authorized subpoenas to be served upon them related to charges that they tried to corrupt the environmental trial in Ecuador where Chevron faces a potential $113 billion liability, according to representatives for Ecuadorian rainforest residents suing the company.

Diego Borja, who has emerged as a key figure on Chevron's Ecuador legal team for engaging in "dirty tricks" to undermine the 18-year litigation, has apparently vacated the luxury California home that Chevron had rented for him and Portilla since June 2009. Neighbors have said that Borja and Portilla moved to an undisclosed location in Texas.

Borja became a person of interest in the lawsuit after he was recorded last year bragging about his role in "cook(ing) evidence" for Chevron to hide illegal levels of toxic contamination and presiding over various "dirty tricks" to help the oil giant escape liability, including a video sting operation against a judge. He was moved from Ecuador, where he is under official investigation, to California at Chevron's expense and paid a monthly salary.

Borja's sudden disappearance from California was discovered when lawyers for the indigenous plaintiffs attempted to serve subpoenas on him and Portilla commanding them to testify about their roles in falsifying evidence. Portilla, who is Ecuadorian, also worked for Chevron in the Ecuador trial as part of the evidence-handling team and in setting up dummy corporations, according to legal papers.

The timing of Borja and Portilla's move is particularly suspicious given that Borja's colleague, Wayne Hansen, apparently has disappeared from his residence in Bakersfield, California. Hansen was Borja's partner in a failed "sting" operation in which they secretly recorded misleading interviews with the Ecuadorian judge formerly overseeing the environmental case.

In August 2009, Chevron released the videotapes to the news media and accused the judge of being involved in a bribery plot, even though the judge did not attend the meeting where Borja and Hansen offered a bribe and there was no evidence that the judge engaged in misconduct. The plaintiffs charged the tapes were part of a Nixon-style dirty tricks operation likely orchestrated by Chevron's lawyers in Ecuador and the United States.

Before Borja could be interviewed by Ecuadorian authorities investigating the bribery allegations, Chevron paid for his relocation to California and is now paying the fees of a high-profile San Francisco attorney to represent him. His attorney, Chris Arguedes, has blocked all efforts to interview Borja about his work for Chevron.

"We believe Chevron needs to explain whether it is actively assisting Borja and Hansen to evade the authority of the federal courts in California," said Karen Hinton, spokesperson for the Ecuadorians suing Chevron.

"Borja, Portilla, and Hansen have apparently tried to corrupt and sabotage the Ecuadorian trial by cooking false evidence to favor Chevron," she added. "It is critical that all information related to their unlawful activities in Ecuador, including any assistance provided them by Chevron employees and lawyers, be disclosed immediately before a judgment is rendered in the Ecuador court."

Since 2007, the plaintiffs have accused Chevron of evidence tampering in the trial. Borja confirmed the plaintiffs' charges when in taped conversations he admitted the company had "cooked" evidence.

The tapes were made by Santiago Escobar, a childhood friend of Borja's who lives in Canada. They have been turned over to authorities in Ecuador and the United States.

In legal briefs filed with the Northern District Court of California, the plaintiffs repeated Borja's statements that he collected soil samples at contaminated sites and, with Portilla's assistance, replaced contaminated samples with clean ones. Then the two, as employees of an "independent" lab, submitted them to the court as evidence.

"Borja has admitted to engaging in what he has described as a 'dirty tricks' operation, involving those soil samples, to support Chevron's litigation strategy," reads the plaintiffs' brief.

"In short, Chevron has gone to extraordinary lengths and employed the full force of its vast resources to frustrate the Ecuadorian plaintiffs' efforts to obtain a fair trial," the brief continues.

Escobar had told journalists that Borja indicated to him that he has carried out a series of clandestine operations on behalf of Chevron's trial team in Ecuador over a series of years. In June 2009, Escobar said Borja told him he arranged "the biggest business deal of his life" that would "take down the lawsuit" and that he had received a "ton of money" from Chevron for his work. He also said that if the plaintiffs knew what he knew about Chevron's corruption, they would win the trial in an instant.